Hotels in Singapore are so full that some tour agents check their tourists into hotels in Johor Baru and Batam.
They then make arrangements to ferry them to Singapore, said Ms Patricia Auyeong, senior director of National Association of Travel Agents Singapore.
This gap in the market has prompted some property owners to make some quick, but illegal money offering their units to tourists for short-term stays.
The latest report released by Singapore Tourism Board showed that last year 13.2 million tourists visited and spent $22.3 billion, 18 per cent more than the year before.
Last year, the hotel industry enjoyed an average occupancy rate of 86 per cent and $2.6 billion in room revenue.